Sharing my learnings from the book, How to Make Money in Stocks by William J. O’Neil
How to Make Money in Stocks by William J. O’Neil
this book offers rational, well-documented guidance for anyone who wants to make smart investments – even people who have never owned stock before. It explains how to: make money reading the daily financial news pages; pick the best industry groups in the market; read charts like an expert to improve stock selection and timing; and reduce losses and mistakes
- investing in stocks is a risky game but there are tried and tested methods that will help you choose good companies, invest in them at the right time & avoid unprofitable ones.
- you should learn from the behavior of past stocks and apply it to the present. Yoh do this by reading stock charts
- in a stock chart, you look at price patterns. The most important one being the cup with handle.
- when choosing stocks, you should look for those with big earnings increases.
- look for great, pioneering & innovative companies. Invest in them at the right time
- the principle of supply and demand applies to the stock market too.
- you should buy industry leaders meaning they’re the ones with best quarterly & annual earnings growth, strongest sales growth, widest profit margins & highest return on equity
- you should look for stocks with institutional sponsorship (stocks handpicked to include in mutual funds)
- you should keep a close eye on the general market direction